Kyrgyzstan’s economic week - June 26-30, 2017

Reduction of enterprises: Kyrgyzstan made the first steps to clarify properties of the state at this moment. This week it was announced that only 166 state enterprises function in Kyrgyzstan out of 1100. According to data of the State Fund for State Property Management, all other enterprises exist only on paper. 137 enterprises out of 166 are not transformed into state enterprises. In order to achieve greater efficiency, the State Property Management Fund proposes the Government to leave only 26 enterprises out of these 137. 59 are proposed to be transformed into state institutions, since they are financed from the republican budget. More than 10 are subject to corporatization, 20 - to liquidation, 4 - to privatization.

The price will not change: It also became known that the State Property Management Fund does not intend to reduce the price of Megacom, the mobile operator for sale. It was officially announced that it is not planned to reduce the cost of Alfa Telecom CJSC, which acts with the brand name of Megacom.

It is known that the initial cost of the company was 19.7 billion soms. However, after the first auction, which did not take place due to lack of participants, the cost was reduced by 25%. The second time the auction was also not held because of the repeated absence of bidders. The third time, Megacom was put up for auction for 13.5 billion soms, this time the auction did not take place due to a lack of time for "preparing documents".

There are several proposals that will be submitted to the Government. But the State Property Management Fund do not plan to reduce the company's price at the auction.

The number of taxpayers is growing: This week the State Tax Service summed up the campaign for the adoption of the Unified Tax Declaration for 2016. By the middle of the year, almost 419,000 taxpayers submitted the declaration.

The statistics testify the annual increase in the number of taxpayers. Thus, 29,494 more taxpayers submitted declarations in 2017 compared to 2016. In 2016 by 13,730 more than in 2015. The number of those who submit declarations increased by 14.7% for the last three years.

Remittances grow: Compared to the last year, the volume of remittances increased by almost 39%. According to data of the National Bank of the Kyrgyz Republic, for five months of 2017 net inflow amounted to $ 695 million, which is 39% more than in the same period last year.

Fluctuations in exchange rates are related to external factors, such as the fall of the ruble against the dollar and the fluctuation in the price of oil. The National Bank also does not abandon the idea of ​​opening an Islamic bank in Kyrgyzstan, despite criticism of international financial institutions.

Investor found: A tender for the construction of small hydropower stations in Kyrgyzstan was announced this week. The Kyrgyz Government’s intention to build small hydropower stations was supported by the Russian Rosatom, which offers a promising project of environmentally safe and economically efficient mini-hydroelectric power stations in a container produced by the Hungarian GANZ plant.

The company will not take part in the tender, but expressed its readiness to cooperate with the winner. The company believes that "investors themselves can make a choice in favor of economical and safe equipment of the highest quality, which will save their money in construction and installation works and maintenance." The Hungarian GANZ has been working successfully since 1844. For example, in Almaty region of Kazakhstan it has been operating since 1962 and the equipment manufactured by GANZ is still in operation there.

Take almost half! Kyrgyz officials propped the Chinese companies to consider investing by acquiring a 49% stake of Air Kyrgyzstan airline and creating a joint venture on its basis. Consul General of the Kyrgyz Republic in Guangzhou Maksat Tentimishov made such a proposal on Hainan Island in Haiku to Director General of Strategic Marketing of HNA Aviation Investment Group Cheng Mingjun.

At the meeting, representatives of Hainan Airlines announced their interest in carrying out flights from Bishkek to Urumqi. The Chinese are also offered to use the Manas airport as a transit link for Hainan Airlines.

Important restrictions: The Parliament of Kyrgyzstan adopted in the first reading a draft law that will limit the number of foreign workers in the republic. The bill is aimed at protecting the national labor market and harmonizing the migration legislation of Kyrgyzstan.

Amendments are made to limit the number of foreign workers in one economic entity from 10 to 20% of the total number of employees and to divide foreign workers into categories - highly qualified specialists, specialists, unskilled workers, individual entrepreneurs.

At this point, it is difficult to establish the exact number of foreign workers in Kyrgyzstan. Its possible to control somehow the migrants from other countries, but it is difficult to identify the number of visitors from the Celestial Empire. At the same time, there are examples of when Chinese companies bring to Kyrgyzstan a lot of workers under different pretexts, the number of which usually make almost half of the company's employees. And the number of Chinese and other foreign companies operating in Kyrgyzstan is growing. The law is aimed at resolving cases when in such companies the number of newcomers would be strictly controlled.